A More Powerful Britain - speech to IPPR North

Speech by Dan Jarvis, Labour MP for Barnsley Central, to IPPR North #StateOfTheNorth conference in Sheffield.

Thank you – it’s a pleasure to join you today. I’d like to begin by sharing a story from the Himalayan mountains.

During my A-Levels I took a job as a cleaner to earn the money to go climbing in Nepal.

On our trek up the Annapurna peak, we stayed with a local family who gave us shelter for a few days.

They were incredibly kind and shared everything they had with us – even though they had almost nothing.

I particularly remember those days because I had picked up a stomach bug, and – without wanting to go into too much detail – I spent more time than I would have liked hunched over their toilet…

And it was in one of those moments, in a small hut halfway up one of the world’s tallest mountains, 13,000 feet above sea level, and 4-and-a-half thousand miles from home, that I looked down into that toilet and saw three words etched into the bowl that have stayed with me till this day:

‘MADE. IN. SHEFFIELD.’

And I remember it today.

Because of my family’s roots – both my Dad and my youngest daughter were born here.

And because it serves as a vivid reminder of this city’s role as one of the great engine rooms of the British economy, with reach right across the globe.

And what more fitting place for us to consider our nation’s economic future than here in Sheffield’s Town Hall?

This building was unveiled by Queen Victoria at the dawn of the 20th century.

She opened its doors using the latest technology of the age - a remote control!

And it stands today as a monument to our country’s heritage as the workshop of the world and the cradle of the Industrial Revolution.

So when people speak today of harnessing the power of our northern cities, of unlocking their full potential, and engineering a better economic future where all our regions can flourish on the world stage, we know these goals are not beyond our reach.

Because Britain has done this before. And with determination, creativity and political will, we can do it again.

INTRODUCTION

That is why the work of IPPR North is so important. I’d like to thank Ed Cox and his team for bringing us together and for inviting me to speak to you.

And let me pay tribute to the contribution that you’ve made to our public life over the past decade – IPPR North has shown that think tanks don’t have to be based inside the M25 to shape the debate about Britain’s future.

You understand better than most that the story of the North need not be one of decline and deindustrialisation.

These regions are full of promise and potential.

That is reflected again in the excellent State of the North report you have published today.

Together the combined economies of the North West, North East and Yorkshire & Humber are worth almost £300bn.

If it were a country it would be the 10th largest economy in Europe.

The North is home to a million businesses, 29 universities, and 8 major ports – including some of the busiest trading hubs in Europe.

But as an MP here in Yorkshire, I know there are challenges too.

We’ve seen that through the crisis in our steel industry over recent days.

Britain’s economy is more regionally unbalanced than any other on the Continent.

And too much of our regions’ potential is being wasted.

From poverty to productivity – the North is still lagging behind the South.

A family in Wakefield will typically have £7,000 less than a family in Wandsworth to put food on the table, fill up the car and get away for a holiday.

A worker in the North on average has to work 18 months to generate the same economic growth that a worker in London produces in a year – not because of any personal lack of endeavour, but because of the relative strength of our regional economies.

And the North is aging fast.

Not just because people are living longer – but because too many young people feel the only route to fulfilling their potential is by moving south.

Overcoming these northern challenges is not a provincial question – it should be a national priority.

So today I want to talk about how we build that better future economy; how devolution can help extend prosperity and social justice to every corner of our country; and how I believe my party should respond to the debate on the Northern Powerhouse.

Because we have heard a lot from the Government about our northern economies over recent months.

And I welcome that conversion.

Although it was only a few months ago that the Government said they couldn’t define where the north actually was.

Let me give them some tips.

It’s where a roll becomes a breadcake…

It’s where an alleyway becomes a ginnel…

And if we invited them for dinner, they’d probably turn up late…!

But the Tories’ talk of a Northern Powerhouse does represent a choice for my party.

It is a test.

Because it would be the easy choice to dismiss the Northern Powerhouse as a smokescreen, an illusion to rebuild Tory fortunes in the North, or a gimmick to carry George Osborne into Number 10.

But I believe Labour can offer more on this issue than opposition for opposition’s sake. More than just easy politics.

We can do better than that.

And I believe the public expect us to do better than that.

Because this devolution debate represents perhaps the greatest opportunity to remake the State and empower people for a generation.Let’s be clear – it was a debate that Labour started.

You heard from John Prescott about how much of this builds on his Northern Way project.

So I don’t want to spend the next five years rubbishing the idea of a Northern Powerhouse. I want Labour to lead the debate about how we build it and shape it according to our values.

And that is my argument today.

George Osborne has said that he is not sure if his plans will work.

Our job is to make sure that they do work – and work for the many, not just the few.

So I commend all the Labour council leaders across the country who are playing their part in doing that – including Julie Dore and Steve Houghton here in the Sheffield City Region.

They are standing up for their communities in the best traditions of our party.

And I appreciate it has not been easy to carry that responsibility with the ingenuity to make things work in difficult circumstances.

Together our ambition should be a powerhouse that not only drives our nation’s economy, but that also tackles the deep inequalities across our country – that puts power, wealth and opportunity into the hands of every community across our northern regions.

Power.Wealth.Opportunity.

Three pillars for fairness that should define the structure of the Northern Powerhouse.

Let me say something about each of them in turn.

POWER

First, power.

We know that too much power has been concentrated in too few hands in this country for too long.

That’s why Labour began talking about moving power away from Westminster in the last Parliament.

Because the principle of sharing power is woven into the fabric of our party.

It’s a belief written into our constitution: That we should strive for a democracy ‘where decisions are taken as far as is practicable by the communities they affect.’

I remember the book I produced almost a year before the election.

It was brimming with exceptional ideas from Jon Cruddas, Andrew Adonis, Steve Reed and local government leaders like Sharon Taylor.

It had devolution right at the forefront.

But we didn’t follow through.

We let the Tories drop their Northern Powerhouse onto the foundations that we had laid. And we allowed them to lift the language of innovation and opportunity from under our noses.

Our plans for more apprenticeships, shared leave for grandparents, cracking down on non-doms, free childcare, and a much higher minimum wage.

When I brought forward a Bill to make work pay in Parliament last year, Ministers said it was unworkable.

Now they say it is a priority.

I don’t lose heart from that. I take heart from it.

Because when the other side take their lead from us, it shows we are winning the debate rather than losing it.

But I’m not satisfied for the Labour Party to merely become a think tank for the government.

Our determination has always been to be the government.

Not only to win arguments, but to win elections so that we can deliver a full Labour programme – not just the policies cherry-picked by our opponents.

And the difference we can make to people’s lives when we have the power to put our principles into practice is being shown by elected Labour Councils all over Britain.

So our first step should be to reclaim this devolution agenda and show that Labour is the true party of putting power in people’s hands.

Because our politics is disconnected from most people’s lives.

The Scottish Referendum, and the rise of populist parties like UKIP across the north, has shown that many people are reaching for something different – something that speaks to the neighbourhoods where they were born, and their own local identity.

We need to tap into that.

We need to root decision-making in people’s sense of place, and bring politics closer to the places they care about.

More than two thirds of people living across the north feel that they don’t have any say in the future of their communities.

We need to give them a voice.

Let me use an example from Durham County Council – an innovating Labour local authority led by Simon Henig.

They’ve asked residents to trust their representatives – by showing that politicians are also ready to trust the people.

At a time when money is tight, Durham and many other councils have given local people the power to decide how funding is prioritised.

More than 20,000 residents have come to events to have their say.

Together they’ve allocated more than £1.5m to over 300 local projects.

And it has made a world of difference.

But contrast that to the behind-closed-doors process we are witnessing during the construction of the Northern Powerhouse.

It is even reported that the Treasury has warned council leaders that their bids may be blocked or disadvantaged if they publicise what powers they are seeking.

Now I understand and accept these are sensitive negotiations.

But I do think the Government is missing a real opportunity here to engage the public.

We don’t want powers to be moved from Whitehall to the Town Hall only for people to still be left on the outside looking in.

We will have a better chance of success if we give local businesses, community leaders and the public a proper say in what devolution should look like for their area.

But it does sadly link to a broader truth about how Ministers are going about this process.

When the last great reorganisation of local government took place in the 1960s it was overseen by a Royal Commission.

It’s a far cry from the ‘devolution revolution’ of 2015. IPPR North has even said that it is showing signs of ‘devo-disarray.’

And I can understand why.

As many as 38 different cities and regions have submitted bids for more powers within the past month.

Yet there is no clear strategy, still no definable boundaries for how far the powerhouse might extend, or how the pieces will fit together.

We’ve seen Ministers turning backwards and forwards on the electrification of the TransPennine railway – now going ahead again but with a four year delay for passengers.

And this week the Government unveiled plans for a North East powerhouse, after weeks of acting like spectators while steelworks in Redcar and Scunthorpe face going to the wall.

George Osborne told the Tory conference a few weeks ago that they were ‘the builders.’ Well, this is a cowboy effort.

And the Chancellor needs to do much more to show that his powerhouse rhetoric will be matched by reality.

There needs to be a much clearer national plan for how the different devolution deals will complement one another.

And that should include protections for communities like mine up the road.

Barnsley is a town located between this region’s two largest cities – two Labour cities brilliantly led by Judith Blake and Julie Dore – but we don’t want to be a place that people just drive past on their way to Leeds or Sheffield.

We want the powers and resources to stand on our own feet.

So I support the Government’s proposal to devolve business rates.

It was after all another proposal borrowed from Labour’s manifesto.

But this needs to be done fairly.

More than half of councils in England will struggle to raise the same amount from business rates that they currently receive from the central government grant.

So there needs to be a redistributive mechanism to support councils with less developed local economies.

Giving power to some should not leave others feeling powerless.

WEALTH

Let me turn to the second pillar: wealth.

The cities of the North are growing faster than anywhere else in the UK outside the capital.

But we know there is more we can do to bring prosperity to every home across these regions.

More than 10% of workers in the North are underemployed.

And you are more likely to be on a part-time or temporary contract here than in any other part of the country.

These workers don’t just want a job – they want a better job, and a government who will work hand in glove with businesses to create the jobs of the future.

In the 18th and 19th centuries it was northern inventors like George Stephenson and Richard Arkwright who helped spark revolutions in transport and manufacturing.

It created more jobs and wealth for working people than anything that could previously have been imagined.

So we must judge the Northern Powerhouse on how it creates the conditions for the innovators of today to unlock the opportunities of tomorrow.

Take my part of South Yorkshire.

Barnsley is a community built on coal.

We were a town that kept the lights on, through war and peace, in good times and in bad.People in Barnsley are proud of our mining history.

But we know that the future we want for our kids won’t be found underground.

We want to attract the new opportunities in digital and hi-tech industries.

Let me give you an example of what I mean.

If you say the words Orgreave in these parts, many people’s minds will turn to bitter memories of the Miner’s Strike.

But if you go to Orgreave colliery today, you now find a completely different picture.

It’s home to the Advanced Manufacturing Park.

Created under the last Labour Government, it’s the result of partnerships between Boeing, Rolls Royce, the University of Sheffield, and others.

And it’s become one of the leading hubs for hi-tech manufacturing.

Trialling new technologies, taking on new apprentices, and training a skilled workforce that’s already the envy of companies across the world.

That is the type of prosperity that the Northern Powerhouse should aim to deliver.

And we’ll only achieve it if devolution goes hand-in-hand with a proper industrial strategy.

But as has become clear during this steel crisis – Britain no longer has a clear industrial strategy.

What’s more – this government has made a virtue of not having one.

Civil servants have even been told not to use the words ‘industrial policy’ because it is not a sufficiently Conservative phrase.

I’m afraid that’s not good enough.

Our Government should have an official view about Britain’s future industrial capacity.

But instead they are offering the same excuses they used to withdraw support from Sheffield Forgemasters in 2010.

That loan would have positioned Forgemasters as a premier producer of components for nuclear power stations.

Five years later – this country’s nuclear energy future is being paid for with Chinese investment and built by French constructors.

And it’s not only workers on Teeside who have been let down.

Deciding whether we preserve some of the best coke ovens, and the largest blast furnace in our country, has consequences for our national security as well as regional prosperity.

Because it undermines our freedom and our influence if we become overly-reliant on other countries for essential resources that we will need in the future.

These are decisions of profound national importance. We shouldn’t wander into them without considering the long-term strategic implications for our country.

Yet it is not clear if letting these steelworks close has been factored into the Strategic Defence & Security Review, or if the matter has even been discussed by the National Security Council…

It feels foolish when the economic conditions could easily change in a few years’ time.

It underlines why our northern ambitions should be greater than to settle for the existing model of fragile growth fuelled by consumer debt and soaring house prices.

We should set our sights on delivering a better form of sustainable economic growth: a modern economy built on higher-productivity, higher-wages, and a higher standard of living.

Let me suggest four priorities that could help us get there.

First, we need to invest in innovation.

We are competing in a global market where China is growing its investment in science by 36% a year.

So we need to reverse decades of under-investment in our northern regions.

More than half of government spending on research and development today is concentrated in London and the South East.

By contrast, businesses are investing twice as much to support R&D in the North as the government. So we urgently need to address this disparity.

We will get closer to our goal of spreading wealth across the North when it can compete on a level playing field – with levels of investment in R&D that match our leading European competitors.

And I hope the Chancellor will take steps to address this in the forthcoming Spending Review.

Second, we need to focus on infrastructure – the veins and arteries of our economy.

When the first Chinese leader to ever visit this country came to Britain in 1979, his stay included a ride on an express train to Derby. It convinced him to tell his minister for the railways that China needed to learn from the British.

Can we be as confident that the current Chinese Premier will have taken the same message back to his country last week?

While China is racing ahead, the UK’s infrastructure investment is the 7th lowest in Europe.

And northern infrastructure is creaking.

But that shouldn’t come as a surprise.

Investment in transport infrastructure is £2,600 per head in London compared to only £380 in the North.

We won’t succeed in spreading wealth fairly across the UK while some regions receive seven times more funding than others.

So it’s right that we give regions the powers and resources to respond to their communities’ local transport needs.

I welcome the creation of new bodies like Transport for the North – and the National Infrastructure Commission.

Now the Government needs to equip the Commission with the powers it needs to hold Ministers to account if they don’t deliver.

So today I have written to Lord Adonis with this submission for the Commission’s in-tray:

One of the National Infrastructure Commission’s first tasks should be to produce a review of the North/South infrastructure divide –

An independent assessment that maps out regional priorities, informs long-term planning, and helps ensure that local decisions are integrated with national interests.

I think that would support decision-making at a devolved level, and put us on the road to spreading more wealth, more fairly across the country.

Because debates such as whether we have sufficient airport capacity should not only be about airports in West London and West Sussex.

Growing regional airports like Manchester, Leeds/Bradford and Newcastle should be part of the conversation too.

Third – we need to protect Britain’s place in Europe.

This is crucial.

Developments like the Advanced Manufacturing Park that I spoke about simply wouldn’t have been possible without European start-up funding.

Neither would my journey here today.

I came via Sheffield’s railway station – refurbished in the last decade with the help of EU investment.

It’s one example of the countless ways that being in Europe has benefited our northern communities.

We so often take them for granted, but we’d miss them as soon as they weren’t there.

None us pretend that the European Union is perfect.

But wherever we live in these islands, what unites all of us is that our future prospects depend so much on our place in a Single Market of 500 million consumers.

The best route to a wealthier North and a better Britain is by working for it within Europe – not from the side-lines.

Fourth: all our ambitions need to be underpinned by a basic sense of fairness.

Because when we see a further 40% of unfair cuts to local government coming down the track – with the greater burden set to fall on more deprived communities in the North – it is fair to question whether the Chancellor is only interested in devolving blame rather than real power.

So we need fairer funding for local government – not a repeat of previous settlements where the most deprived communities were penalised ten times harder than the wealthiest.

And this needs to extend to individual families too.

Because there is no surer way to undermine people’s hopes to get on in life, than to go after the tax credits of 3 million working households – including 700,000 families with children across the North of England – while handing inheritance tax cuts to the richest estates in the country.

Not when around a fifth of children in these regions are already living on the poverty line.

Ministers should listen to what was said in Parliament last night and think again.

Survival of the fittest is not a good philosophy for devolution, or for spreading wealth fairly across our country.

OPPORTUNITY

And that brings me to my third pillar: opportunity.

I want the daughter of a cleaner from Kingstone in my constituency to have the same opportunities as the son of a barrister from Kingston-upon-Thames.

And one of our tests for devolution should be whether it brings us closer to that goal.

This is the key point I want to make today.

The Northern Powerhouse cannot just be about a stronger economy – it must also be about creating a more just society.

Because measures like whether our GDP is rising are meaningless if life chances are still a postcode lottery.

As IPPR North has highlighted today, less than half of the most deprived children in the North achieve a good level of development before their 5th birthday.

There is a 12% performance gap between the poorest children in London and the North.

And because of inequalities across the region, getting a good start in life depends more upon where you live in these regions than anywhere else in England.

So we won’t succeed in spreading opportunity across our country without tackling these inequalities.

A fairer society and a stronger economic future are both sides of the same coin.

I witnessed it first-hand when I was in Grimsby earlier this year.

I saw its offshore wind turbines and the investment going into green technologies. But for the local people I meet on the doorstep, those skilled jobs felt far beyond their reach.

And as a new report revealed last week – it is those who live furthest away from London who are least likely to have the computer skills that are so vital to succeeding in today’s digital world.

So the Northern Powerhouse won’t deliver greater opportunity without a laser-like focus on skills.

And that needs to start in the early years.

If we look at our children’s centres, the North West, North East and Yorkshire & Humber still receive the poorest reviews from Ofsted.

So if we’re going to talk about essential infrastructure, and making the most of our most precious resources, let’s make supporting children and revitalising services like Sure Start a priority.

Let’s give communities power over skills budgets so they can shape the training that their young people need to succeed.

Let’s develop better links between educators, employers and Local Enterprise Partnerships, so that young people can access apprenticeships and get a foot on the career ladder.

And in the debate about how we close the gap in GCSE grades between north and south, let’s explore giving regions a greater say in education.

Because communities deserve just as much of a voice as the Department Education in deciding things like which neighbourhoods most need new school places.

But we know that while opportunity in life begins with a good education, it’s not the end of the story.

It’s about having a roof over your head, a safe place to live, good public services that are there when you need them.

So I want us to learn from innovating councils about how we can tackle the issues that stifle opportunity and hold people back.

70% of jobseekers are being failed by the Tories’ centralised Work Programme.

Let’s learn from Labour councils like Oldham – brilliantly led by Jim McMahon.They are giving unemployed people a greater say about the training they need.

Let’s learn from how Manchester have made their streets safer.

Sir Richard Leese and his team have halved youth crime rates – with a redesigned criminal justice system and better early intervention to help young people turn their lives around.

And there are many more examples that I could mention.

But the overall opportunity is the same:

If we can define the Northern Powerhouse not by the piecemeal proposals presented by George Osborne, but by our values and our ideas for how we can build it better, then we can make a start on extending opportunities to millions of people across the North today, and enable them to become wealthier and more powerful in their everyday lives.

CONCLUSION

So let me conclude with this thought.

When I was growing up under the Tory governments of the 80s and 90s, discussions about the North too often sounded like something from Brassed Off – that great British film about a miners’ brass band from Barnsley, whose pit was on the brink of closure.

There’s an iconic final scene when the band win a national competition at the Royal Albert Hall – but their future was crumbling around their ears.

And I was reminded of that scene when we were fundraising last year to send the Barnsley Youth Choir to the World Championships in Latvia.

It was an opportunity beyond anything those young people had ever experienced.

And the community came together to make it happen.

And here’s the thing.

The Choir didn’t just compete at the world championships.

Against all the odds.

They won those world championships.

And the lesson I take from that, is that these regions have both a timeless spirit and limitless potential.

And that if we can come together, give our communities the support they need,and put power, wealth and opportunity into the hands of the many, then these regions can not only succeed: We can be the best in the world.